The root "Pag" means fish in Latin, but I don't see any fishermen in your family. Still searching for the meaning. The only other thing that is close, in Italian is Paghero, which means the acknowledgment of a debt (an IOU) and then Pagare means to repay a debt. The surname "Pagano" does not exist at all in the 1600's or 1700's according the census records. Of course, maybe nobody named Pagano had any property, so can't tell from that. I remember seeing it later on in the 1800's documents.
The oldest form of your surname that I've found thus far, seems to be "Pauria" ("Paguria" is also found, but less frequently in the 17th century). The "Pagoria" spelling is used predominantly in the 1755 census. There is also the occasional "Paoria" later on in the 1800's and of course the most common, "Pagoria", becomes fairly standardized in the late 19th century. I have found several docs that use the spelling Pagoria and Paoria interchangeably for the same individual. But, the death record for Mariano Pagoria, and a few other of the oldest records, are spelled "Pauria". The church's marriage record for Giovanni and Maria Cancasi also spells the name Pauria in the early 1800's. This spelling may be only on documents written in Latin, I'm not positive.
I have been told by fellow Italian genealogists that such changes in spelling
simply reflects subtle changes in Sicilian dialect through time. Records clerks
wrote what they heard being said to them. Most peasants could not read and
write. On those docs where a Pagoria did sign his own name, I think they always
spell it with the g. The spellings without the g become less frequent in the in
the late 19th century.